Cosmetics importers on Wednesday suggested bringing a change in the duty structure that, according to them, has been encouraging many traders for adulteration.
They cited the 'minimum value' provision of the authorities to levy VAT and taxes on imported beauty products as the key reason for corruption in the sector.
The observations were made at a view-exchange meet with cosmetic importers, marketers and traders organised by the Directorate of National Consumer Rights Protection (DNCRP) in its conference room in Dhaka.
DNCRP head AHM Shafiquzzaman said the directorate during its drives found anomalies and fraudulence in the marketing of foreign cosmetics while setting maximum retail price and adulteration of products which might even cause cancer.
Facial and skin-whitening creams are marketed without authentic approval, thereby dodging VAT and taxes by a quarter (known as 'luggage party') who are not authorised to import, he added.
Mr Shafiq said his directorate has been conducting drives against duplicate and harmful cosmetics across the country.
"We've called cosmetic importers and other market players to find exact reasons for flooding the market with adulterated products," he said.
Azmol Hossain Bablu, chairman of Naba Distribution Ltd, a leading cosmetic importer, said without bringing any change in the duty structure, nobody could eradicate adulteration from the sector.
He suggested that 'the minimum value' provision, used by customs to levy VAT and taxes, be removed first to fight corruption in the sector.
The minimum value is a threshold that the customs determine through issuing a statutory regulatory order (SRO) for the assessment purpose.
Mr Bablu said tools like minimum value help grow the nexus between unscrupulous customs officials, C&F agents and traders.
Traditional importers hold corrupt officials and C&F agents hostage for having such minimum value when their products await release from the port, he added.
Mr Bablu urged the government to consider the transaction value for customs assessment following global practices instead of 'minimum value'.
Md Masud Alam, manager of Pure Care, echoed the same view on the issue.
Sharif Mohammad Ali, executive director of Remark HB Ltd, said it costs him Tk 599 to import a foreign-branded lipstick which he found available on a portal at Tk 40.
"How a company could deliver the product at Tk 40? This might be an adulterated product," he pondered awhile.
Mr Ali, however, filed a complaint with the DNCRP against the online platform for allegedly selling the adulterated product.
Swapno supply chain head Tamal Paul said super-chains in Bangladesh could hardly compete in the market as 19.5-per cent VAT and taxes are imposed on products retailed at the chains.
Meena Bazar senior executive Soumitra Kumar Roy said many of his customers looked for foreign-branded cosmetics which "we couldn't supply for not getting those from proper channels".
"But consumers could manage those from alternative sources easily at low prices which ultimately caused a decline in our customer base."
Consumers Association of Bangladesh (CAB) representative Abdul Hannan, DNCRP director Manzur Mohammad Shahriar and deputy director Atia Sultana, among others, also spoke.
DNCRP officials said adulterated and illegally imported cosmetics in the names of foreign brands have flooded the market.
Ten big entities have recently been fined Tk 0.8 million by the directorate in this connection.
Banani-based Color Me, Seoul Mart, Sundora, Bodiline, Banani-Gulshan-based Astorion, Moulovibazar-based Chittagong Store, Mohammadpur-based Infinity, AR Enterprise at Karwanbazar, Fazlu Corporation at Chawkbazar and Anna Plaza at Gulshan DNCC Market were fined in different cases in recent weeks.
